The Federal Trade Commission is sending $4.1 million to 27,584 consumers who were defrauded by a student debt relief scam.
The action follows a 2019 complaint the FTC made against the operators of Mission Hills Federal and Federal Direct Group, alleging the organizations have been tricking student loan borrowers out of their money since 2014.
Fraudsters"tricked students into paying hundreds to thousands of dollars in illegal upfront fees and pretended to lower consumers' monthly student loan payments," the FTC said in a press release. Additionally, the operators claimed to take over the servicing of consumers' loans and thus, often pocketed consumers' monthly payments, the agency said., so it's not surprising that many borrowers are eager to take any chance they have to lower or eliminate their balances.
Many financial scams use similar tactics to try to get you on the hook. If any company or person contacts you and tries to get you to sign up for a service or share any personal information, watch out for a few red flags.Student loan scams often use time-sensitive language like telling you to"act immediately" or"call now to verify."Scammers may make promises that sound too good to be true.
Know that you do not have to pay for any of the existing loan forgiveness programs, although they often require years of qualifying payments or certain types of employment.FSA says it will never ask you for your account password. If anyone asks for your FSA login information, there's a good chance they're trying to scam you.
to learn about common passive income streams, tips to get started and real-life success stories. Register today and save 50% with discount code EARLYBIRD.Student debt relief due to financial hardship could be on its way